Government Reaches Agreement on PLAs, Controversy Remains

To say the least, project labor agreements (PLAs) have been a controversial issue for the construction industry. And like many controversial issues, debate and partisanship sometimes leads to the unfortunate consequence of delaying much-needed jobs.

On May 31, the House of Representatives passed an amendment to the Military Construction and Veterans Affairs and Related Agencies Appropriations Act for FY 2013 (H.R.5854), removing a provision of the act that would have prevented the federal government from using PLAs on federal construction projects. With the amendment, the federal government now has the option to make use of PLAs, rescinding the previous restriction on them.

In the past, some in the construction industry have argued PLAs create an imbalance in bidding with regard to labor and, therefore, should not be mandated. Others contend that PLAs promote fairness by leveling the labor variable with a fair wage and moving the bidding focus to other factors, such as efficient management, product and material procurement, overall skills, and safety.

“PLAs aren’t a union vs. nonunion issue,” said Marco Giamberardino, National Electrical Contractors Association’s (NECA) director of Government Affairs. “Any contractor, regardless of their labor affiliation, can bid on a project covered by a PLA. Because PLAs determine all terms and conditions in advance, they allow contractors to more accurately predict labor costs and schedule production timetables.”

Opponents maintain PLAs create disparity between workers, and it is a factor on a list of issues both sides have in the argument, which may be attributable to misinterpretation. In the interest of clarity, Kristen McDonough, director of legislative affairs for NECA, stressed that the federal government does not require PLAs. It merely encourages them, and since the Obama administration established that policy in 2009, relatively few government construction projects have used PLAs.

As an unfortunate consequence to the controversy surrounding PLAs, the Department of Labor announced its withdrawal of a solicitation for a Job Corps Center in Manchester, N.H., that would have opted to use a PLA, further delaying a project that has already seen a two-year setback.

On a separate project to extend Metrorail from Washington, D.C., out to Dulles International Airport in Virginia, the Metropolitan Washington Airports Authority (MWAA), which is overseeing the $6 billion construction project, dropped a PLA, a conflict in which Virginia Gov. Robert McDonnell threatened to pull $150 million in funds for the project if the PLA was not removed. MWAA had previously approved the PLA, but the standoff with McDonnell threatened to further impede the already delayed project.

The ironic twist to this story is PLAs are intended to promote a streamlined method of contracting in which all disciplines and entities involved in a contract are brought together under a single understanding, ensuring everyone is in the loop. Unfortunately, with its controversy and partisanship, proponents and opponents seem unable to reach an agreement on PLAs, and the battling back and forth can leave jobs, such as the Job Corps Center and the threatened Metrorail extension, delayed indefinitely.

That such losses are tragic seems to be something everyone can agree on.